What are the different tax ramifications if the ADU is considered a rented space in a single family home vs a multi family duplex?
There really is no ramification tax-wise. Treating it as "I rent out a part of my home" just uses different math to obtain the same results you would get if you treated it as a physically separate rental property.
But which is easier/best depends on the setup.
For example, if the detached ADU has it's own physically separate metered utilities and you elect to treat it as a physically separate rental unit, the only thing you're dividing manually are property taxes, mortgage interest and insurance. Otherwise, if utilities are not metered separately then depending on your selections, you'd have to split everything manually. There's also more than one way to split those utilites, and you can only split them if they are actually being shared with the tenant. For example, if the tenant does not utilize your Internet access, or use your cable TV hookup, you can't split/share those expenses.
Also, when it comes to a land line telephone, you can't share the expense for that either if you only have one line. Doesn't matter if you actually share it or not.
But if done correctly, one way has no real worth while tax advantage over the other way. You can always figure it both ways to see which is better for you.
